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US Dollar Weaker, US Treasuries Stable Early on April 28

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US dollar

After struggling for four consecutive trading days to stabilize above 99, the US Dollar Index is weaker in the early hours on April 28. The index is trading below 99. The sentiment in the US dollar is weaker amid the disappointing tax cut announcement by Trump’s Administration.

The US dollar’s rally, triggered after President Trump’s election win, is mainly due to high expectations regarding tax cuts and increased infrastructural spending. As a result of the disappointing tax cut announcement, upward momentum in the US dollar has been decreasing. Also, President Trump’s failure to pass the health care bill added weakness to the market. The increase in initial jobless claims, according to a report released on April 27, also weighed on the US dollar. According to data released by the US Department of Labor, US initial jobless claims rose to 257,000 last week, which is higher than the expectation of 245,000 jobless claims.

At 6:30 AM EST on April 28, the US Dollar Index was trading at 98.78—a fall of ~0.3%.

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US Treasury yields

After a brief pullback for two consecutive trading days, US Treasury yields are trading higher in the early hours. The increase in durable goods orders for three consecutive months shows the acceleration of business investment in 1Q17. The market is looking forward to the release of quarterly US GDP scheduled to release at 8:30 AM EST today. The market is also awaiting speeches from FOMC members Harker and Brainard scheduled for today.

At 6:50 AM EST on April 28:

  • The ten-year Treasury yield was trading at 2.309—a rise of ~0.56%.
  • The 30-year Treasury yield was trading at 2.978—a rise of ~0.42%.
  • The five-year Treasury yield was trading at 1.827—a rise of ~0.35%.
  • The two-year Treasury yield was trading at 1.266—a rise of ~0.63%.

The iShares 20+ Year Treasury Bond ETF (TLT) fell 0.03%, while the ProShares UltraPro Short 20+ Year Treasury ETF (TTT) fell 0.24% and the ProShares UltraShort 20+ Year Treasury ETF (TBT) rose 0.3% on April 27.

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